Posts Tagged ‘UAW’
Just Say No! (To GM, Ford, & Chrysler)
Shortly after winning a decisive victory in Washington, the Democrats in Congress are aggressively trying to turn all the good will into anger. For reasons that I don’t fully understand, they are lining up behind the Big Three auto-makers to hand out the corporate welfare checks. Earth to Reid : THIS IS A REALLY BAD IDEA!
It’s a bad idea not just because taxpayers are tired of corporate handouts.
It’s a bad idea not just because the Democrats are going to lose the support of moderate Republicans.
It’s a bad idea because IT WON’T FIX THE PROBLEM!
GM, Ford, and Chyrsler got stuck trying to run a 20th century company in 2008. They are structured to sell lots of big cars. Instead, the market demand is for fewer small problems. This is a fundamental problem that will not be fixed by a $25 billion “loan” from the U.S. Treasury. Fortunately, there is an efficient and proven way to restructure a big debt-laden company : BANKRUPTCY!
Yes, it sounds scarey. Yes, shareholders and some creditors will lose. Yes, it will force some renegotiaions with the powerful Union of American Autoworkers. And Yes, some people will lose their jobs. But it’s the only way that the Big Three can hope to remain competitive.
Don’t get me wrong. Bankruptcy is not a pleasant experience for employers or employees. It will get worse before it gets better. But the key to bankruptcy is that it allows the business to make big, huge, funadmental changes–which is exactly what the Big Three need to do.
So please, Democrats, enough with the corporate welfare. I fully support unemployment insurance for auto workers who will lose their jobs. I fully support federal infrastructure projects to employ them. That’s the sort of government assistance that’s actually effective.
Tags: Automobile, Congress, Ford, UAW, Union of American Autoworkers
Filed under economics, politics :
Comments (7) :
Nov 18th, 2008
